Due to the rise in freight rates in recent years, an increasing number of traders are considering moving to production and industry and gradually dispensing with imports, importing machinery and production lines from China.
Indeed, China’s exports of machinery, machinery, and transportation in the first half of 2022 amounted to about 152.5 million US dollars, due to:
- China’s enormous capacity to manufacture heavy and medium machinery at costs
- Great technical development
- Availability of raw materials and skilled manpower.
If you are thinking of importing a production line or importing a single machine, this article will guide you through the import journey, so follow us…
1: Specify the specifications and characteristics of the machines and devices you want to import
Even if you are going to order some type of finished manufactured machine without a specific customization you want; as some importers of production lines and machines do, you should understand those machines regarding their characteristics, specifications, compliance with quality standards and include what you want specifications in your product specification sheet.
What are the specifications that you have to clarify in the specification sheet?
- Technical Specifications and Parameters
Most machine and vehicle buyers do not want custom specifications, however, indicating the technical specifications of the product is very necessary even if the machine is ready. There is no global standard for “good quality” – especially in China, the standard here is your requirements as well as industry standards, of course.
The technical specifications of the machines you want to import from China that you must specify accurately are:
- Machine model.
- Engine type and capacity.
- Protection layer
- Control system.
- Outer packaging.
Searching for machines and machines on sale online can be a starting point to determine specifications that match you and your goal of purchasing those machines.
- Compliance with quality standards in your country
The specifications required for the machines and devices you want to import from China vary depending on the country you want to import to, the “location of the target market”. You can see here the regulations for the standards required in Saudi Arabia and the Arabian Gulf for any type of machine you want to import.
You can also search your country’s government websites, hire a professional customs clearance office in the local market, or a company that specializes in importing machinery and production equipment.
2: Search for the required machinery and equipment factories
After you have set the standards and specifications you want in the required machine, which complies with the standards of your country, it is time to search for the factories of these machines, and here are three ways you can search:
- Search by Internet
You can search for factories through B2B platforms and websites, such as ALIBABA.
You can type the name of the machine, or put a picture of it through the site’s search engine to show you similar suggestions, where you can know the name of the factory by clicking on the images shown.
But if you cannot buy machines online without inspecting the machine yourself, here you have two options; the first is to hire an inspection company specialized in inspecting industrial machinery and equipment, the second option is to visit the China exhibitions yourself, but you will also need an expert in inspecting those industrial equipment before accepting the deal and completing the purchase.
- Visit trade shows in China
The positive thing about exhibitions is that they gather a lot of suppliers and factory representatives in one place; they display their products with details and explanations about them.
One of the advantages of this method, despite its high cost, is to get answers to all your queries.
Among the most important exhibitions that display machines, devices and production lines:
- Canton International Fair:
It is the largest international exhibition in China, and the largest international exhibition in Asia for machinery and production lines such as sewing machines, pumps, electric motors and many more. Located in the famous city of Guangzhou
- Shanghai International Auto Show: Located in Shanghai, it is the largest market in Asia for cars and parts, with many Chinese and international factories participating.
- Hong Kong International Trade Fair (HKTDC): The fair hosts several trade fairs, showcasing its products from medical devices, electronics and printing machines.
If neither method finds a suitable solution, there is a compromise that combines lower cost and no trouble to travel to China, and the advantages of checking machines and the factory are the next option.
- Import agents for the benefit of others (sourcing agent)
They are companies acting as your agents in China, and have great experience in the Chinese market, machinery factories and suppliers.
Advantages of dealing with import agents:
- Deep search for the machine you want and find you reliable factories.
- Experience and knowledge in the market, prices and required paperwork.
The only problem with this method is to increase the costs you will pay, but it may be the best way given those costs compared to the expenses you can pay by traveling or importing from a bad factory.
3: Verification of the supplier and factory producing the machine or device
The current step is considered one of the most important steps before importing machines and production lines from China, as verifying the supplier and manufacturer producing the machine is necessary to ensure the required standards and ensure the truth of the factory you are dealing with.
You can do this in several steps:
- Checking the commercial background of the supplier: by asking others who dealt with him, or requesting and verifying licenses from the supplier.
Certainly, the trusted supplier will reveal to you the information you want, as a kind of marketing for him.
If it refuses, it is often an unreliable resource and we advise you to avoid it.
- Visit the factory: A visit to the factory is the best guide to verify the factory, as you will make sure of the fact that the factory exists and its identity, and your visit to the factories helps you take a closer look at the mechanism of the factory’s work, and make sure of your expectations and standards for them in production.
- You can use the services of an inspection company to do this job for you, as they provide supplier or factory verification service.
The important point now for importing machines is to answer the question of what if the machine breaks down? And here we move on to the next step
4: Verification of the existence of warranties and spare parts for imported machines
To import ordinary products such as clothes and consumer goods is normal and acceptable to have defective parts, but what about machines and their high cost and eagerness to work means that a complete production line stops, so it is necessary to make sure of the following:
Check for safeguards
Many factories may claim to have warranties for machines and devices that extend for several years, and this is part of the marketing they do for themselves.
But in fact, they may try to evade the warranty, so before ordering from the manufacturer, you must confirm the guarantees provided by the supplier and clarify them in the contract.
You should consider the terms involved in the warranty such as the warranty duration, and the costs of shipping the machine back to the factory.
Check for spare parts
It is known that machines always need maintenance and replacement of some parts, so you should check for spare parts at the factory.
When importing machines from China, we always recommend relying on local spare parts (if any) and storing them, because if you need spare parts and order parts from the factory, you should keep the following in mind:
- The long time it takes for spare parts to arrive leading to production stoppages
- Pay the shipping costs for those parts and customs duties
5: Calculate the total cost of importing machinery from China
After you have chosen the machine and the supplier, you have to calculate the total cost of the project, in order to determine the capital you need.
One of the costs you have to consider when importing machines from China is
- Initial cost: It is all the costs you will pay either in order to obtain information, or to search for suppliers and factories “through commercial service companies, for example.”
- Machinery price: final price of hardware and machinery
- Customs duties and taxes When you enter machines into your country, which vary from one country to another, you can use a customs broker to help you in this regard, or search the HS CODE Commodity Code: It is a unified code between the countries of the world consisting of 6 digits, through which you can identify the customs duties imposed on the machine through the customs website in your country for the machine.
- Shipping and packaging costs.
- Quality inspection costs.
- In addition to the costs of preparing and preparing the place of manufacture.
6: Negotiating with suppliers in order to obtain the best supply contract
Negotiating with suppliers is a key thing in international trade and you must learn negotiation skills, how to negotiate and what to negotiate.
The common misconception about the idea of negotiation is that negotiation is limited only to the price, and the fact that everything is negotiable and sometimes negotiating other things is more important than negotiating the price.
When it comes to importing machinery from China, there are some important conditions that you must negotiate to get a good deal for you:
- Negotiate Safeguards
Even if the supplier or manufacturer provides you with warranties, you must negotiate, confirm them and clarify those terms in the contract.
For example, increasing the warranty period, or bearing the full costs of reshipping parts, etc.
- Incoterms (shipping terms)
Negotiating shipping terms is crucial; the right shipping requirement can play an important role in your success when importing machinery from China.
The shipping terms determine where the goods are received, where the supplier’s responsibility ends at and where and where your responsibility begins.
For example, when agreeing on EXW Incoterms, it means that the supplier’s responsibility ends with the completion of the packaging of the machines, and you must collect them from their warehouses.
For example, when FOB shipping terms are agreed, the supplier is responsible for transporting the machinery to port and loading them onboard (onboard delivery).
So I advise you to familiarize yourself more with China freight forwarding Company.
A Chinese supplier or any other supplier, expects you to negotiate the price, so they offer you a slightly higher price at first. You have to negotiate the price; however, as mentioned above, price is not the only item to negotiate.